The Monitor's View:
“A survey released last week by the Pew Hispanic Center found more than four in 10 Mexicans are willing to leave their country to live in the US. One in five would risk a dangerous, illegal border crossing. Most surprising, one in three college graduates wants to flee. Before Washington takes up immigration reform this fall, it needs to take a hard look at Mexico's disillusionment.” ---- Christian Science Monitor

Thursday, February 7, 2013

HE PUNKED THE
AMERICAN PEOPLE TWICE BUT WILL STILL GO DOWN IN HISTORY HAS ONE OF AMERICA’S
WORST AND MOST CORRUPT PRESIDENTS.

“I’m not here to
punish banks!” Bankster-owned Barack Obama from the floor of the Senate, State
of the Union Message.

During Obama’s
first two years alone, banks made more profits than under all eight years of
Bush. The Obama bank’s profits and crimes soared, as did foreclosures.

MEXICAN DRUG
DEALER OPERATES IN OUR BORDERS

THE MEXICAN
DRUG CARTELS OPERATE IN 2,500 AMERICAN CITIES AND WHOLEHEARTEDLY ENDORSE OBAMA’S
OPEN AND UNDEFENDED BORDERS AGENDA.

“Oropeza,
48, was arrested May 31, 2007, by police in Saraland, Ala., who stopped him on
a traffic violation. Checking his record, they learned of the investigation in
Texas.

They
searched the van and discovered 185 pounds of cocaine hidden under a false
floor. That allowed federal agents to freeze Oropeza's bank accounts and search
his marble-floored home in Brownsville, Robinette says.”

The
government, like the banks, had a vested interest in shutting down the
investigation, as the results of any genuine inquiry would have exposed
negligence and collusion on the part of the regulators as well as gross
violations of law by the banks that would have made it more difficult for the
Obama administration to avoid criminal prosecutions.

The Times also reported that such “independent
investigators” played a key role in the HSBC money laundering scandal, helping
cover up the extent of the British-based bank’s money laundering operation for
Mexican drug cartels.

World Socialist Web Site

wsws.org

Published by the International Committee
of the Fourth International (ICFI)

Firms make billions as middlemen in government cover-up of Wall
Street crimes

By Andre Damon
7 February 2013

In the network of corrupt and incestuous relations between
government financial regulatory agencies and the banks they nominally police, a
growing role is played by private, for-profit “consulting” firms that serve as
middlemen in the government cover-up of corporate crime.

The New York Times in a front-page article last week called
attention to this lesser-known mechanism used by the government to protect Wall
Street from being held to account for the fraudulent and illegal practices in
which it engages on a daily basis.

The Times wrote: "Federal authorities are scrutinizing
private consultants hired to clean up financial misdeeds like money laundering
and foreclosure abuses, taking aim at an industry that is paid billions of
dollars by the same banks it is expected to police."

The firms in question operate in essentially the same way as the
credit rating agencies that facilitated the subprime meltdown. Just as Standard
& Poor’s Rating Services and Moody’s Investors Service are paid by the
banks whose securities they rate, the consulting firms tasked with
investigating banks are chosen and paid by the very institutions they are
investigating. This arrangement is based on a howling conflict of interest.
Consulting firms that want to keep old clients and add new ones, and increase
their profits, are obviously under pressure to cover up the misdeeds of their
banking paymasters.

Moreover, the same revolving door by which individuals move
seamlessly between Wall Street and the regulatory agencies exists between the
consulting firms and the banks and regulatory bodies.

Last month's $8.5 billion foreclosure fraud settlement with major
US lenders lifted the lid on bank regulators' increasing use of these
“independent investigators.” Tasked with finding the extent of fraud and
illegality in the processing of home foreclosures, these companies helped the
banks cover up their fraudulent activities and ensure that the extent of their
wrongdoing was not brought to light.

The settlement between ten major mortgage lenders and the Office
of the Comptroller of the Currency (OCC), a branch of the Treasury Department,
related to widespread fraud committed by the banks in their rush to foreclose
on as many homes as possible in 2009 and 2010. To expedite the foreclosure
process, the banks had employees or contractors sign off on thousands of
mortgage documents every month, swearing that they had intimate knowledge of
their contents when, in reality, they had not even read them.

This resulted in the improper expulsion of an unknown number of
families—probably in the hundreds of thousands—from their homes.

In April of 2011, the OCC, the Office of Thrift Supervision (OTS),
and the Board of Governors of the Federal Reserve System ordered individual
reviews of foreclosures carried out between 2009 and 2010 by fourteen mortgage
lenders, including Bank of America, Citibank, JPMorgan Chase and Wells Fargo.

The investigation was intended to individually review all cases in
which homeowners claimed that they were improperly foreclosed on, so that each
victimized household could receive a cash payout. The findings of such an
investigation would have undoubtedly shown that foreclosure fraud was far more
prevalent than had been previously known, and laid the basis for further
lawsuits against the lenders.

Instead of reviewing the foreclosures themselves, regulators had
the banks hire so-called independent investigators, who, while receiving $2
billion in fees from the lenders, dragged their feet in reviewing the
foreclosure cases.

Last month, government regulators closed down the review on the
grounds that it was too time-consuming and too expensive for the banks and came
up with a sweetheart settlement that cost the banks a relative pittance.

Instead of payouts to individuals who were harmed by the banks'
wrongdoing, the lenders agreed to split a $3.3 billion cash payout among 4.2
million foreclosed homeowners, without "determination of harm." As a
result, homeowners will receive a check of under $1,000 even if they were
illegally thrown out of their homes.

The government,
like the banks, had a vested interest in shutting down the investigation, as
the results of any genuine inquiry would have exposed negligence and collusion
on the part of the regulators as well as gross violations of law by the banks
that would have made it more difficult for the Obama administration to avoid
criminal prosecutions.

When setting up the "Independent Foreclosure Review" in
April 2011, regulators claimed that they had to rely on independent contractors
such as Promontory Financial and PricewaterhouseCoopers because regulators
themselves had neither the money nor the manpower the review the claims.

"The Office of the Comptroller of the Currency employs just
3,800 people, only about 2,000 of whom are bank examiners," said Bryan
Hubbard, director for public affairs operations at the OCC in a telephone
interview Monday. "It would simply not have been practical to hire the
staff necessary for the review."

He added that "independent consultants are used often by many
regulators, not just the OCC, in support of enforcement actions. It was not
unusual." He added that the decision to end the review "will provide
more money to more borrowers than maintaining the original course."

The argument that closing down the investigation resulted in
greater compensation for victimized borrowers is absurd.

The growing scandal over the role of “independent consultants” in
the foreclosure abuse settlement prompted Senator Elizabeth Warren and
Representative Elijah Cummings to send a letter to the US Federal Reserve and
office of the Comptroller of the Currency last week, asking them to publish
documents related to the role of the consultants hired by the banks to review
foreclosures.

The role of such "independent investigators" in covering
up the banks' crimes goes beyond the foreclosure settlement. Since the 2008
financial meltdown, it has become increasingly common for financial regulators
to rely on such companies in regulatory actions. The New York Times
reported that the OCC required the hiring of such consultants in more than 130
regulatory actions since 2008.

The Times
also reported that such “independent investigators” played a key role in the
HSBC money laundering scandal, helping cover up the extent of the British-based
bank’s money laundering operation for Mexican drug cartels. The newspaper
reported that HSBC was cited for its loose money laundering protections in 2003
and turned to the consulting firm Deloitte & Touche to review its
compliance with regulations.

In 2010, the bank was again investigated in connection to its
money laundering activities, ultimately leading to a $1.9 billion settlement
with regulators late last year. To help determine the fine to be levied, HSBC was
ordered to hire an independent consultant to assess the extent of its legal
transgressions.

The bank hired
its reliable ally of previous years, Deloitte & Touche, which, according to
the Times, "generously bundled hundreds of missed transfers into a
single report," which "may have helped save the bank from some
government fines."

"Independent investigators" like Deloitte and Promontory
are staffed largely by former regulators, who, having gained experience in
government, have turned to using their knowledge to help banks skirt
regulations, for sizable fees. Promontory Financial, which examined loans for
Bank of America and Wells Fargo, is a case in point. The company was founded in
2000 by Eugene Ludwig two years after he left his position as Comptroller of
the Currency.

Last month, Promontory announced that Julie Williams, the former
chief council at the OCC, would join the group to become the firm's director of
advisory practice. “I thought I could do more good helping firms understand and
comply with government expectations—which are not always just what’s in rules
and regulations—at Promontory,” she said upon taking the job.

PricewaterhouseCoopers, which carried out the
foreclosure fraud investigation for Citigroup, brags to potential clients that
its "teams consist of experienced regulatory risk specialists, including
ex-regulators, who not only know the rules, but have also implemented and
assessed compliance against them." OBAMA PROMISED HIS
CRIMINAL BANKSTER DONORS NO PRISON TIME AND NO REAL REGULATION. DID HE DELIVER?

The JPMorgan
scandal also throws into relief the government’s failure to prosecute those
responsible for the 2008 financial meltdown. Despite overwhelming evidence of
wrongdoing and criminality uncovered by two federal investigations last year,
those responsible have been shielded from prosecution.

Records show that four out of Obama's
top five contributors are employees of financial industry giants - Goldman
Sachs ($571,330), UBS AG ($364,806), JPMorgan Chase ($362,207) and Citigroup
($358,054).

The social and
historical catastrophe confronting mankind is not simply the product of an
economic crisis in the abstract. This crisis is mediated by class interests,
and these class interests find expression in definite actions. Behind the central
banks and governments stand the interests of a financial elite whose
relationship to the rest of society is fundamentally parasitic.

*

AMERICAN HAS WITNESSED HOLDER AND OBAMA PROMISE OBAMA’S
CRIMINAL BANKSTER DONORS THEY WOULD NEVER BE PROSECUTED.

OBAMA HOLDER HAVE ALSO ENDLESSLY HARASSED AMERICAN STATES
WITH LAWSUITS TO ADVANCE OBAMA’S LA RAZA AGENDA OF OPEN BORDERS, NO E-VERIFY,
NO ID TO VOTE, ENDLESS GRINGO-PAID DREAM ACTS TO KEEP THE ILLEGALS CLIMBING OUR
BORDERS AND JOBS.

WELLS FARGO, ALONG WITH BANK of AMERICA, IS A MAJOR DONOR TO
THE MEXICAN FASCIST PARTY of LA RAZA.

BOTH BANKS HAVE OPENED BANK ACCOUNTS FOR ILLEGALS USING
PHONY MEX CONSULATE IDS.

A SUBSTANTIAL AMOUNT OF THE MONEY ILLEGALS DEPOSIT IS MEX
GANG MONEY.

WELLS FARGO HAD THEIR CALIFORNIA MORTGAGE LICENSE REVOKED IN
2003. IT SILL IS. THE CRIMINAL BANK SIMPLY DECLARED ITSELF ABOVE THE LAW AND
WENT ON PERPETRATING THEIR MORTGAGE SCAMS ON CONSUMERS NATIONWIDE UNTIL TAX
PAYERS WERE FORCED TO BAILOUT OUT ALL THE DAMAGES.

“The program of “gunwalking,” as the tactic of permitting known
buyers for the Mexican gangs to purchase weapons and take them to Mexico, was
part of a murky but undoubtedly reactionary effort by the US government to
develop relations with the drug cartels, some of which deposited huge sums in
American banks, to the benefit of Wall Street.”

US House votes contempt citation for
attorney general

By Patrick Martin
30 June 2012

The
Republican-controlled House of Representatives voted to find Democratic
Attorney General Eric Holder in contempt of Congress Thursday, the first time
in US history that such a sanction has been applied to the top US law
enforcement official.

The
vote came on a near-party-line vote of 255 to 67, with 108 Democrats
abstaining. The majority of Democrats walked out of the Capitol during the
voting in order to make a show of outrage over the contempt citation. The
action is not expected to have any practical effect, since the House of
Representatives will now request the US Attorney for Washington DC, who is
Holder’s subordinate, to bring charges against his own boss, and he is likely
to refuse.

The
contempt citation is purportedly the outcome of a protracted congressional
investigation into “Fast and Furious,” an abortive effort by the Phoenix office
of the Bureau of Alcohol, Tobacco and Firearms, ostensibly to gather
intelligence on Mexican drug cartels. The ATF allowed gang representatives to
buy weapons at American gun shops and then bring them across the Rio Grande
into Mexico.

The
operation was first initiated under the Bush administration, under the codename
“Wide Receiver,” but was shut down in 2007. It was revived after Obama and
Holder took office, under its new name, although it is not clear whether the
White House or senior Justice Department officials were aware of it.

In
December 2010, Border Patrol agent Brian Terry was shot to death in a gun
battle in which several “Fast and Furious” weapons were involved. The program
was abruptly shut down, and top Justice Department officials initially denied
its existence in a February 4, 2011 letter to Congress that was later
retracted.

The
House Governmental Operations committee, headed by California Republican
Darrell Issa, has focused its investigation not on the “Fast and Furious”
program itself, but on efforts to prove that top Justice Department officials
lied about the program in the course of a series of responses to the committee
in 2011.

Each
request from Issa’s committee for documents has been followed by further
requests for internal emails about the Justice Department’s response to the
previous document requests, in an evident effort to construct and trigger a
perjury trap that would implicate either Holder or one of his top subordinates
in a purported cover-up.

“Fast
and Furious” does involve serious issues relating to the secret operations of
the federal government. The program of
“gunwalking,” as the tactic of permitting known buyers for the Mexican gangs to
purchase weapons and take them to Mexico, was part of a murky but undoubtedly
reactionary effort by the US government to develop relations with the drug
cartels, some of which deposited huge sums in American banks, to the benefit of
Wall Street. It is likely for this reason that even some Republican
Senators have sought to distance themselves from Issa’s campaign—this is not
the sort of program that is supposed to see the light of day.

The
House Republicans, in fact, are uninterested in exposing either the US
manipulation of the drug gangs or the criminal activities of Wall Street. The
Justice Department has supplied the committee with the documents related to the
origins and functioning of the “Fast and Furious” program. The subpoena
rejected by Holder, which triggered a claim of executive privilege by Obama,
involves 1,500 pages of internal emails between top Justice Department
officials written only after “Fast and Furious” had been shut down.

A
driving force in the campaign over “Fast and Furious” vote is the National
Rifle Association, the ultra-right group that purports to represent gun owners.
Top NRA officials claim that top Obama administration officials devised “Fast
and Furious” in order to produce a series of bloody incidents along the border
involving guns purchased at US gun shops. The purpose of this alleged
conspiracy was to generate political propaganda for sweeping restrictions on
gun ownership that the Obama administration supposedly plans to introduce in
its second term.

Some
17 House Democrats decided to follow the dictates of the NRA and vote for the
contempt citation against Holder, in an effort to win the backing of the
right-wing group in the upcoming congressional elections. Only two Republicans
voted against the contempt citation.

What
is remarkable in the conflict is that there are ample reasons for indicting
Attorney General Holder for criminal actions against the democratic rights of
the American people, but these are of no interest to the ultra-right groups
spearheading the campaign over “Fast and Furious.”

Holder has
been one of the most aggressive spokesmen for the claims of the Obama
administration of presidential power to order the assassination of American
citizens, or to detain them indefinitely without charge or judicial review, in
the name of the “war on terror.” The Justice Department has spearheaded a series
of prosecutions of whistleblowers who have leaked information on
anti-democratic operations of the military-intelligence apparatus within the
United

*SENATOR DIANNE FEINSTEIN AND HER FRIENDS AT WELLS FARGO

WELLS FARGO IS A MAJOR CONTRIBUTOR TO SEN. DIANNE FEINSTEIN, ONE OF THE MOST CORRUPT POLITICIANS IN AMERICAN HISTORY. WELLS FARGO HAD THEIR CALIFORNIA MORTGAGE LICENSE REVOKED IN 2003 FOR ITS WIDESPREAD MORTGAGE FRAUD PERPETRATED ON CONSUMERS. THE BANKSTER SIMPLY DECLARED ITSELF ABOVE THE LAW AND CONTINUED TO PRACTICE ITS RUTHLESS PREDATORY PRACTICES NATIONWIDE.WELLS FARGO'S CRIMES WERE BAILOUT OUT BY THE AMERICAN PEOPLE. FEINSTEIN VOTED FOR THE NO-STRINGS OR PRISON TIME BAILOUTS.PRIOR TO THESE BAILIOUTS, FEINSTEIN FRONTED FOR THE BANKSTERS FOR THEIR "BANKRUPTCY" REFORM, WHICH NOW PRECLUDES CONSUMERS FROM OBTAINING HELP IN BANKRUPTCY COURT FOR THE VERY MORTGAGE CRIMES WELLS FARGO IS SO WELL KNOWN FOR

Lou Dobbs Tonight

Monday, November 12, 2007

Mortgage giants Wells Fargo and Bank of America are accused of slapping
dubious fees on homeowners struggling to save their homes. With fewer new
mortgages being written, these
companies appear to be leaning on these lucrative fees to stay
profitable—with devastating consequences for homeowners. We’ll have that
report.

Records show that four out of Obama's top five contributors
are employees of financial industry giants - Goldman Sachs ($571,330), UBS AG
($364,806), JPMorgan Chase ($362,207) and Citigroup ($358,054).

Consider the Obama administration's choices for the four
most important positions in financial sector law enforcement. The attorney
general (Eric Holder) and the head of the Justice Department's criminal
division (Lanny Breuer) both come to us from Covington & Burling,
a law firm that represents and lobbies for most of the major banks and their
industry associations; indeed Breuer was co-head of its white collar criminal
defense practice, and represented the Moody's rating agency in the Enron case.
Mary Schapiro, the head of the SEC, spent the housing bubble in charge of
FINRA, the investment banking industry's "self-regulator," which gave
her a $9 million severance for a job well
done. And her head of enforcement, perhaps most stunningly of all, is Robert
Khuzami, who was general counsel for
Deutsche Bank's North American business during the entire bubble. So zero
prosecutions isn't much of a surprise, really.

*

Banking Is a Criminal Industry
Because Its Crimes Go Unpunished

Posted:
07/16/2012 8:23 am

Consider
just this month's news in financial services.

First,
Barclay's has been manipulating the Libor, the main interest rate upon which
most other interest rates and financial transactions are based, since 2005.
Moreover, Barclay's traders were colluding with traders in many other banks to
assist them in manipulating the Libor too, so that they could all profit from
their bets on it.

Second,
JP Morgan Chase is having a really great month. Recent reports describe how it
is resisting Federal subpoenas related to
price-fixing in U.S. electricity markets. It is also accused (by former
employees among others) of deliberately inflating the performance of its
investment funds to obtain business. And finally, JP Morgan's failed "London
whale"
trade, which has now cost over $5 billion, is being investigated to determine
whether the loss was initially concealed from regulators and the public.

Third,
HSBC is paying a fine because it allowed
hundreds of millions, perhaps billions, of dollars of money laundering by rogue
states and sanctioned firms, including some related to terrorist activities and
Iran's nuclear efforts. But HSBC is only one of at least 12 banks now known to
have tolerated, and in some cases aggressively courted, money laundering by
rogue states, terrorist organizations, corrupt dictators, and major drug
cartels over the last decade. Others include Barclay's, Lloyds, Credit Suisse,
and Wachovia (now part of Wells Fargo). Several of the banks created special
handbooks on how to evade surveillance, created special business units to
handle money laundering, and actively suppressed whistleblowers who warned of
drug cartel activities.

Fourth,
a new private lawsuit cites documents indicating that Morgan
Stanley successfully pressured rating agencies into inflating the ratings of
mortgage-backed securities it issued during the housing bubble.

Fifth,
Visa and Mastercard have just agreed
to pay $7
billion to settle a private antitrust case filed by thousands of merchants, who
alleged that Visa and Mastercard colluded to fix fees and terms of service.

Just
another month in financial services. Is it unusual? No, it's not. If we go back
just a little further, we have UBS, HSBC, Julius Baer, and other banks actively
marketing tax evasion services to wealthy U.S. and European citizens. We have
senior executives of several banks (including JP Morgan Chase and UBS) strongly
suspecting that Bernard Madoff was running a Ponzi scheme, but deciding to make
money from him rather than turn him in. And then, of course, we have the
financial crisis and everything that led to it. As I show in great detail in my book Predator
Nation, we now possess overwhelming
evidence of massive securities fraud, accounting fraud, perjury, and criminal
Sarbanes-Oxley violations by mortgage lenders, investment banks, and credit
insurers (including senior executives of Countrywide, Citigroup, Morgan
Stanley, Goldman Sachs, Bear Stearns, AIG, and Lehman Brothers) during the
housing bubble that caused the financial crisis. If we go back to the late
1990s, we have the massively fraudulent hyping of Internet stocks, and several
banks (including Merrill Lynch and Citigroup) actively aiding Enron in
committing its frauds.

So,
July 2012 really isn't abnormal at all. The reason for this is very simple.
Over the past two decades, the financial services industry has become a
pervasively unethical and highly criminal industry, with massive fraud
tolerated or even encouraged by senior management. But how did that happen?

Well,
deregulation helped, of course. But something else was far more important. It
is the one critical factor that unites all of the episodes cited above,
including those of this month. This critical unifying factor is the total
number of criminal prosecutions of major firms and senior executives as a
result of all of these crimes combined.

And
what is that number?

Zero.

Literally
zero. A number that neither President Obama nor Mitt Romney shows the slightest
interest in changing.

Consider
the Obama administration's choices for the four most important positions in
financial sector law enforcement. The attorney general (Eric Holder) and the
head of the Justice Department's criminal division (Lanny Breuer) both come to
us from
Covington & Burling, a law firm that represents and lobbies for most of the
major banks and their industry associations; indeed Breuer was co-head of its
white collar criminal defense practice, and represented the Moody's rating
agency in the Enron case. Mary Schapiro, the head of the SEC, spent the housing
bubble in charge of FINRA, the investment banking industry's
"self-regulator," which gave her a $9
million severance for a job well done. And her head of enforcement, perhaps
most stunningly of all, is Robert Khuzami, who was
general counsel for Deutsche Bank's North American business during the
entire bubble. So zero prosecutions isn't much of a surprise, really.

In
contrast, what do you think would happen to you if, as a lone individual, you
were caught supporting Iran's nuclear program? Do you think that you would get
off with a "deferred prosecution agreement" and a fine equal to a few
percent of your annual salary? No?

But
that's because you don't live right. You probably haven't been to the White
House a dozen times since President Obama took office, or attended White House
state dinners, like Lloyd Blankfein has. Nor have you probably overseen
millions of dollars in lobbying and campaign donations, or hired senior
administration officials, or sent your executives into the government in senior
regulatory positions, or paid $135,000 for a speech by someone who later became
chairman of the National Economic Council. And, well, you get the law
enforcement that you pay for.

LAREDO,
TEX. - Stashing cash in spare tires, engine transmissions and truckloads of
baby diapers, couriers for Mexican drug cartels are moving tens of billions of
dollars in profits south across the border each year, a river of dirty money
that has overwhelmed U.S. and Mexican customs agents.

Officials said stemming the
flow of this cash is essential if Mexico
and the United States hope to disrupt powerful transnational criminal
organizations that are using their wealth to corrupt, terrorize and kill.

Despite
unprecedented efforts to thwart the traffickers, U.S. and Mexican authorities
are seizing no more than 1 percent of the cash, according to an analysis by The
Washington Post based on figures provided by the two governments.

The
major Mexican drug organizations write that off as the cost of doing business -
losing a percentage far smaller than the fees for an ordinary wire transfer or
ATM withdrawal, Mexican and U.S. law enforcement officials said.

The
Obama administration recently proposed a $600 million surge in spending and
personnel, including additional gamma-ray scanners and money-sniffing dogs, as
part of an intensifying effort to capture the dollars going from U.S. drug
consumers to Mexican mafias.

The
drug traffickers and their Colombian suppliers smuggle $20 billion to $25
billion in U.S. bank notes across the southwest border annually as they seek to
circumvent banking regulations and the suspicions aroused by large cash
deposits, studies by federal officials, regulators and academics show.

"If
we fail to curtail these money flows, the confrontation with organized crime
will generate more violence and more corruption," Carlos Pascual, the U.S.
ambassador to Mexico, said at a border conference in El Paso this month.

Most
of the money is smuggled in plastic-wrapped bricks of $20 bills. Often the bank
notes retain the sticky residue or fine powder generated by the marijuana,
cocaine and methamphetamine sold to the most voracious consumers in the world.

"Cash
is the ultimate challenge for us," John Arvanitis, chief of financial
operations for the Drug Enforcement Administration, said in an interview.
"It moves so rapidly, so fluidly. It crosses borders. It moves in bulk. It
is stored in warehouses. It is moved into business. They have multiple,
multiple options. They can hide a million dollars in a tractor-trailer, or they
can carry it across the border in a handbag."

Since
the two countries pledged to bolster joint operations in March 2009 and began searching
more vehicles heading south, customs agents have seized record amounts of cash
- not only in vehicles but also hidden in children's toys, loaves of bread and
body cavities.

But
authorities are barely making a dent in the cartel profits. U.S. agents
captured $85 million in illicit cash along the southwest border last year,
according to the Department of Homeland Security. Mexican inspectors have
seized $31 million in suspicious cash at all ports of entry into the country
over the past three years, according to figures provided by the Mexican customs
agency. In two years of undercover operations targeting Mexican cartels in the
United States, the DEA seized $216 million, although it is unclear how much of
that would have been smuggled south. (THE MEXICAN DRUG CARTELS HAUL BACK FROM THE U.S. FROM
$40 TO $60 BILLION PER YEAR.)

"We
see mostly small seizures, in small denominations. It doesn't mean that much to
them," said a senior Mexican official who investigates financial crimes,
speaking on the condition of anonymity because of security protocols. "To
really hurt the criminal organizations, we would have to be confiscating much,
much more."

Asked
how much more, the official said, "a billion dollars."

T.J.
Bonner, president of the union representing Border Patrol agents, said seizing
cash in southbound traffic is extremely difficult.

"Throw
a backpack of cash over the fence into Mexico, and what are we going to
do?" he said. "Charge someone with littering in a foreign
country?"

WHY THE MEXICAN DRUG CARTELS
LOVE OBAMA’S BANKSTERS!

Mexican officials say a
greater percentage of drug profits remain in the United States than U.S.
officials acknowledge. Former attorney general Eduardo Medina Mora said that,
based on the U.S. notes Mexican banks return to the United States, about $10
billion "does not have an explanation and could be attributed to the flow
of drug trafficking money."

That
figure does not include the billions never deposited in Mexican banks but
quickly smuggled farther south - to Central America, to pay transport costs,
and to Colombia, Peru and Bolivia, to purchase more cocaine.

'No paper
trail'

Cash
smuggled across the border is a leading source of foreign currency in Mexico,
surpassed only by petroleum sales and about equal to the dollars earned from
tourism and official remittances from Mexicans working in the United States.

"There's
no paper trail when you smuggle $400,000 or $500,000 over the border in a
hidden compartment on one car," said David Gaddis, deputy chief of
operations for the DEA.

U.S.
bank notes are easily spent in Mexico, where 67 percent of commercial
transactions are made with cash - often dollars - as opposed to 21 percent in
the United States.

Since
late 2006, when President Felipe Caldern launched his U.S.-backed military-led
offensive against the traffickers, police and soldiers have confiscated $411
million in U.S. currency but only $23 million in Mexican pesos, according to
Mexico's intelligence service.

In
the United States, cash from the wholesale distribution of heroin, cocaine,
methamphetamine and marijuana is consolidated in several key cities, including
New York, Atlanta, Chicago, Los Angeles and the Raleigh-Durham, N.C., area,
before it moves south.

"What
we are seeing is the professionalization of the movement of bulk cash,"
said an agent with U.S. Immigration and Customs Enforcement who spoke on the
condition of anonymity because of security protocols. "We are seeing
specialists in money movement. That's all they do. They prefer to lose drugs
versus money because drugs are so much easier to replace."

ICE
agents said cartels pay couriers about 2 or 3 percent to smuggle cash, far more
than they lose to law enforcement.

At the
crossing

At
the busy border crossing in Laredo, U.S. customs agents search hundreds of
southbound vehicles a day. Pickups and vans filled with household goods bought
in the United States slow to a stop as agents ask the occupants whether they
are carrying weapons, ammunition or more than $10,000 in cash. Almost everyone
says no.

Many
cars are just waved through. Others are briskly inspected. The officers tap on
the vehicle panels with rubber mallets, searching for hidden compartments; open
trunks and glove boxes; use mirrors to examine the undercarriage; hold a
density meter next to the gas tank; and pop open the hood and inspect the
running engine.

"We've
seen hidden compartments in oil pans, with cars running on two quarts of oil
instead of five," said Gene Garza, director of the Port of Laredo for U.S.
Customs and Border Protection.

If
agents detect anything suspicious - if a car with Arizona plates has no bugs on
its windshield or a woman who claims to be the driver's wife looks nervous -
the vehicle is inspected a second time, with cash-sniffing dogs. The vehicle
might then be scanned by X-ray machines and disassembled.

In
a typical seizure here last month, 50 bundles containing $607,629 were found in
a spare tire of a Ford pickup. A few days earlier, $506,057 was discovered in a
false compartment of a car's front bumper. The drivers face charges of cash
smuggling, with a typical prison sentence of a year or two if convicted.

At
the Laredo port alone, 22,000 cars cross into Mexico every day, plus 12,000
pedestrians and 6,000 tractor-trailers. They all can't be searched, officials
say, and $1 million in $100 bank notes could almost fit in a shoe box.

Once
the couriers cross, the risk of being caught is even slimmer, even as Mexico
tries to overhaul its customs agency with help from the $1.6 billion in U.S.
aid in the anti-narcotics Merida Initiative. Mexico has fired more than 1,000
customs agents and hired 2,300 since 2007, doubling their base salaries in an
effort to ward off corruption. Inspectors are subjected to lie-detector tests,
job rotations and monitoring by surveillance cameras.

But
former agents say drug cartels continue to corrupt and intimidate inspectors.
In Ciudad Juarez, across the river from El Paso, more than 30 agents have
resigned in recent months after several co-workers were killed.

In
Nuevo Laredo, a Mexican customs official said his inspectors have seized
"maybe a million dollars" in the past year.

"It's
not enough," said the senior officer, who spoke on the condition of
anonymity because of security concerns. "They keep telling us to find more
and more, but it's very hard."

Just before sunset on April 10, 2006, a DC-9 jet
landed at Ciudad del Carmen, 500 miles east of Mexico City. As soldiers on the ground
approached the plane, the crew tried to shoo them away, saying there was a
dangerous oil leak. So the troops grew suspicious and searched the jet.

They found 128 black suitcases, packed with 5.7
tons of cocaine, valued at $100 million. The stash was supposed to have been
delivered from Caracas to drug traffickers in Toluca, Mexican prosecutors later
found. Law-enforcement officials also discovered something else.

The
smugglers had bought the DC-9 with laundered funds they transferred through two
of the biggest banks in the U.S.: Wachovia and Bank of America. This was no
isolated incident. Wachovia, it turns out, had made a habit of helping move
money for Mexican drug smugglers. Wells Fargo, which bought Wachovia in 2008,
has admitted in court that its unit failed to monitor and report suspected
money laundering by narcotics traffickers. The admission came in an agreement
that Wachovia struck with federal prosecutors in March, and it sheds light on
the role of U.S. banks in contributing to Mexico's violent drug trade.

Wachovia admitted it didn't do enough to spot
illicit funds in handling $378.4 billion for Mexican-currency-exchange houses
from 2004 to 2007. That's the largest violation of the Bank Secrecy Act, an
anti-money-laundering law, in U.S. history â€” a sum equal to one-third of
Mexico's current gross domestic product.

"Wachovia's blatant disregard for our banking
laws gave international cocaine cartels a virtual carte blanche to finance
their operations," says Jeffrey Sloman, the federal prosecutor who handled
the case.

Since 2006, more than 22,000 people have been
killed in drug-related battles. Among the dead are police, soldiers,
journalists and ordinary citizens. The U.S. has pledged Mexico $1.1 billion in
the past two years to aid in the fight against narcotics cartels.

Behind the carnage in Mexico is an industry that
supplies hundreds of tons of cocaine, heroin, marijuana and methamphetamines to
Americans. The cartels have built a network of dealers in 231 U.S. cities from
coast to coast, taking in about $39 billion in sales annually, according to the
Justice Department.

Twenty million people in the U.S. regularly use
illegal drugs, spurring street crime and wrecking families. Narcotics cost the
U.S. economy $215 billion a year â€” in overburdened courts, prisons and
hospitals and lost productivity, the department says.

"It's the banks laundering money for the
cartels that finances the tragedy," says Martin Woods, director of
Wachovia's anti-money-laundering unit in London from 2006 to 2009. Woods says
he quit the bank in disgust after executives ignored his documentation that
drug dealers were funneling money through Wachovia's branch network.

"If you don't see the
correlation between the money laundering by banks and the 22,000 people killed in
Mexico, you're missing the point," Woods says.

Cleansing dirty cash

Wachovia is just one of the U.S. and European banks
that have been used for drug- money laundering. For the past two decades, Latin
American drug traffickers have gone to U.S. banks to cleanse their dirty cash,
says Paul Campo, head of the financial-crimes unit of the U.S. Drug Enforcement
Administration (DEA).

American Express Bank paid fines in 1994 and 2007
after admitting it had failed to spot and report drug dealers laundering money
through its accounts. Drug traffickers used accounts at Bank of America in
Oklahoma City to buy three planes that carried 10 tons of cocaine, according to
Mexican court filings.

Federal agents caught people who work for Mexican
cartels depositing illicit funds in Bank of America accounts in Atlanta,
Chicago and Brownsville, Texas, from 2002 to 2009. Mexican drug dealers used
shell companies to open accounts at London-based HSBC Holdings, an
investigation by the Mexican Finance Ministry found.

Those two banks weren't accused of wrongdoing. Bank
of America spokeswoman Shirley Norton and HSBC spokesman Roy Caple say laws bar
them from discussing specific clients. They say their banks strictly follow the
government rules.

A Mexican judge on Jan. 22 accused the owners of
six money changers in CuliacÃ¡n and Tijuana of laundering drug funds through
their accounts at the Mexican units of Banco Santander, Citigroup and HSBC,
according to court documents. The money changers are in jail while being tried.
Citigroup, HSBC and Santander weren't accused of any wrongdoing. The three
banks say Mexican law bars them from commenting on the case, adding that they
each carefully enforce anti-money-laundering programs.

On June 15, the Mexican Finance Ministry announced
it would set limits for banks on cash deposits in dollars.

Mexico's drug cartels have become
multinational criminal enterprises.

Some of the gangs have delved into other illegal
activities such as gunrunning, kidnapping and smuggling people across the
border, as well as into seemingly legitimate areas such as trucking, travel
services and air-cargo transport, according to the Justice Department's
National Drug Intelligence Center.

These criminal empires have no choice but to use
the global banking system to finance their businesses, Mexican Senator Felipe
Gonzalez says.

"With so much cash, the only way to move this
money is through the banks," says Gonzalez, who carries a .38 revolver for
personal protection. "I know this won't stop the narcos when they come
through that door with machine guns," he says, pointing to the entrance to
his office. "But at least I'll take one with me."

No bank has been more closely
connected with Mexican money laundering than Wachovia.

After a 22-month investigation, the
Justice Department on March 12 charged Wachovia, now owned by Wells Fargo, with
violating the Bank Secrecy Act by failing to run an effective
anti-money-laundering program.

Five days later, Wells Fargo promised in a Miami
federal courtroom to revamp its detection systems. Wachovia's new owner paid
$160 million in fines and penalties, less than 2 percent of its $12.3 billion
profit in 2009.

Bank's regrets

If Wells Fargo keeps its pledge, the U.S.
government will, according to the agreement, drop all charges against the bank
in March 2011.

Wells Fargo regrets that some of Wachovia's former
anti-money-laundering efforts fell short, spokeswoman Mary Eshet says. Wells
Fargo has invested $42 million in the past three years to improve its
anti-money-laundering program and has been working with regulators, she says.

"We have substantially increased the caliber
and number of staff in our international investigations group, and we also
significantly upgraded the monitoring software," Eshet says. The agreement
bars the bank from contesting or contradicting the facts in its admission.

The bank declined to answer specific questions,
including how much it made by handling $378.4 billion, including $4 billion of
cash from Mexican exchange companies.

The Smurfs

Drug money
moves back and forth across the border in an endless cycle. In the U.S.,
couriers take the cash from drug sales to Mexico â€” as much as $29 billion a
year, according to U.S. Immigration and Customs Enforcement. They hide it in
cars and trucks to smuggle into Mexico. There, cartels pay people to deposit
some of the cash into Mexican banks and branches of international banks. The
narcos launder much of what's left through money changers.

By law, the
money changers have to demand identification from anyone exchanging more than
$500. They also have to report transactions higher than $5,000 to regulators.

BOTH WELLS FARGO and BANK of AMERICA,
MAJOR DONORS TO LA RAZA DEM SEN. DIANNE FEINSTEIN, AND CONTRIBUTORS TO THE
MEXICAN FASCIST PARTY of LA RAZA, PERMIT ILLEGALS TO OPEN BANK ACCOUNTS AND
MAKE BANKING TRANSACTION WITH PHONY MEXICAN CONSULATE IDs

The cartels get around these requirements by employing legions
of individuals, including relatives, maids and gardeners, to convert small
amounts of dollars into pesos or to make deposits in local banks. After that,
cartels wire the money to a multinational bank.

The people making the small money exchanges are known as Smurfs,
after the cartoon characters.

"They can use an army of people like Smurfs
and go through $1 million before lunchtime," says Jerry Robinette, who
oversees U.S. Immigration and Customs Enforcement operations along the border
in east Texas.

The U.S. Treasury has been warning banks about big
Mexican-currency-exchange firms laundering drug money since 1996. By 2004, many
U.S. banks had closed their accounts with these companies. Wachovia ignored
warnings by regulators and police, according to the deferred-prosecution
agreement.

One customer that Wachovia took on in 2004 was Casa
de Cambio Puebla, a Puebla, Mexico-based currency-exchange company. Pedro
Alatorre, who ran a Puebla branch in Mexico City, had created front companies
for cartels, according to a pending Mexican criminal case against him.

A federal grand jury in Miami indicted Puebla, Alatorre
and three other executives in February 2008 for drug trafficking and money
laundering. In May 2008, the Justice Department sought extradition of the
suspects, saying they used shell firms to launder $720 million through U.S.
banks.

Puebla executives used the stolen identities of 74
people to launder money through Wachovia accounts, Mexican prosecutors say in
court-filed reports.

"Wachovia
handled all the transfers, and they never reported any as suspicious,"
says Jose Luis Marmolejo, a former head of the Mexican attorney general's
financial crimes unit now in private practice.

It was the Puebla investigation that led U.S.
authorities to the broader probe of Wachovia. On May 16, 2007, DEA agents
conducted a raid of Wachovia's international banking offices in Miami. They had
a court order to seize Puebla's accounts.

U.S. prosecutors and investigators then scrutinized
the bank's dealings with Mexican-currency-exchange firms. That led to the March
deferred-prosecution agreement.

With Puebla's Wachovia accounts seized, Alatorre
and his partners shifted their laundering scheme to HSBC, according to
financial documents cited in the Mexican criminal case against Alatorre.

In the three weeks after the DEA raided Wachovia,
two of Alatorre's front companies, Grupo ETPB and Grupo Rahero, made 12 cash
deposits totaling $1 million at an HSBC Mexican branch, Mexican investigators
found.

The funds financed a Beechcraft King Air 200 plane
that police seized on Dec. 29, 2007, in Cuernavaca, 50 miles south of Mexico
City, according to information in the case against Alatorre.

Laundering money

For years, federal authorities watched as the wife
and daughter of Oscar Oropeza, a drug smuggler working for the Matamoros-based
Gulf Cartel, deposited stashes of $20 bills several times a day at a Bank of
America branch in Brownsville, Texas, less than 3 miles from the border.

Bank employees got to know the Oropezas by the
smell of their money.

"I asked the tellers what they were talking
about, and they said the money had this sweet smell like Bounce, those sheets
you throw into the dryer," says Tom Salazar, an agent who investigated the
family. "They told me that when they opened the vault, the smell of Bounce
just poured out."

Oropeza, 48, was
arrested May 31, 2007, by police in Saraland, Ala., who stopped him on a
traffic violation. Checking his record, they learned of the investigation in
Texas.

They searched the van
and discovered 185 pounds of cocaine hidden under a false floor. That allowed
federal agents to freeze Oropeza's bank accounts and search his marble-floored
home in Brownsville, Robinette says.

Inside, investigators found a supply of Bounce
alongside the clothes dryer.

All three Oropezas pleaded guilty in U.S. District
Court in Brownsville to drug and money-laundering charges in March and April
2008. Oscar Oropeza was sentenced to 15 years in prison; his wife was ordered
to serve 10 months and his daughter got 6 months.

Bank of America's Norton says, "We not only
fulfilled our regulatory obligation, but we proactively worked with law
enforcement on these matters."

Banks aren't the only financial institutions that
have turned a blind eye to drug cartels in moving illicit funds. Western Union,
the world's largest money transfer firm, agreed to pay $94 million in February
2010 to settle civil and criminal investigations by the Arizona attorney
general's office.

"Their allegiance was to the smugglers,"
Holmes says. "What they thought about during work was 'How may I please my
highest-spending customers the most?' "

Workers in more than 20 Western Union offices allowed the
customers to use multiple names, pass fictitious identifications and smudge
their fingerprints on documents, investigators say in court records.

"In all the time we did undercover operations,
we never once had a bribe turned down," says Holmes, citing court
affidavits.

Western Union has made significant improvements, it
complies with anti-money-laundering laws and works closely with regulators and
police, spokesman Tom Fitzgerald says.